Earnings per share (EPS) were $0.52. This was an increase of $0.10,
or 24 percent, from the prior quarter and $0.07, or 16 percent, from
the year-ago quarter. The third quarter’s financial results included
a gain of $0.02 from the sale of the company’s semiconductor product
line for broadband DSL customer-premises equipment. The gain on sale
was included in the company’s most recent business outlook issued
September 11, 2007.

“Strong growth in analog was at the core of our performance in
the third quarter. Our investments in analog technology have led to
broader and deeper engagements with customers. As a result, this part
of our business, which delivers about 40 percent of our revenue, grew
10 percent sequentially,” said Rich Templeton, TI's president
and chief executive officer. “Our growth allows us to continue
to increase our return to shareholders. In the third quarter, we repurchased
$1.4 billion of our stock. In September, our Board authorized an additional
$5 billion in repurchases, and we announced a 25 percent increase in
the dividend.”

Gross Profit
Gross profit was $1.98 billion, or 54.2 percent of revenue. This was
up $200 million from the prior quarter primarily due to higher revenue,
as well as a gain of $39 million on the sale of TI’s DSL product
line that is included in cost of revenue. Gross profit was up $52 million
from the year-ago quarter as a combination of reduced manufacturing
costs and the gain on sale more than offset the impact of lower revenue.

Operating Expenses
Research and development (R&D) expense was $542 million. This was
a decrease of $9 million from the prior quarter and $28 million from
the year-ago quarter. The declines were due to progress in implementing
the company’s advanced CMOS process development strategy.

Selling, general and administrative (SG&A) expense was $429 million.
This was about even with both the prior and year-ago quarters.

Operating Profit
Operating profit was $1.01 billion, or 27.6 percent of revenue. This
was an increase of $204 million from the prior quarter due to higher
gross profit, and an increase of $83 million from the year-ago quarter
due to higher gross profit and lower R&D expense.

Other Income (Expense) Net (OI&E)
OI&E was $53 million. This was a decrease of $3 million from the
prior quarter and $1 million from the year-ago quarter.

Income
Income from continuing operations was $758 million, or $0.52 per share.
Income from discontinued operations was $18 million due to a reduction
of a state tax liability associated with the sale of TI’s former
Sensors & Controls business.

Orders
TI orders were $3.55 billion. This was an increase of $103 million from
the prior quarter as higher demand for semiconductor products more than
offset a seasonal decline in orders for graphing calculator products.
Orders were up $125 million from the year-ago quarter due to higher
demand for semiconductor products.

Cash
Cash flow from operations was $1.53 billion. This was an increase of
$633 million from the prior quarter primarily due to the receipt of
a tax refund and higher net income. Total cash (cash and cash equivalents
plus short-term investments) was $3.67 billion at the end of the third
quarter. This was an increase of $88 million from the end of the prior
quarter and a decrease of $515 million from the year-ago quarter. In
the third quarter of 2007, the company used $1.41 billion to repurchase
40 million shares of common stock and paid $114 million in dividends
to shareholders. Since the end of the year-ago quarter, the company
has used $4.14 billion to repurchase 127 million shares of common stock
and paid $346 million in dividends.

Capital Spending and Depreciation
Capital expenditures were $152 million. This was a decrease of $22 million
from the prior quarter and $124 million from the year-ago quarter due
to lower expenditures for semiconductor manufacturing equipment. TI’s
capital expenditures in the quarter were primarily for semiconductor
assembly and test equipment.

Depreciation was $262 million. This was an increase of $6 million from
the prior quarter and a decrease of $4 million from the year-ago quarter.

Accounts Receivable and Inventories
Accounts receivable were $2.02 billion at the end of the third quarter.
This was an increase of $126 million from the prior quarter and a decrease
of $66 million from the year-ago quarter due to changes in revenue.
Days sales outstanding were 50 at the end of the third quarter, unchanged
from the end of the prior quarter and the year-ago quarter.

Inventory was $1.45 billion at the end of the third quarter. This was
an increase of $26 million from the prior quarter. Compared with a year
ago, inventory decreased $41 million. Days of inventory at the end of
the third quarter were 78, unchanged from the end of the prior quarter
and up from 73 a year ago.

Outlook
TI intends to provide a mid-quarter update to its financial outlook
on December 10, 2007, by issuing a press release and holding a conference
call. Both will be available on the company’s web site.

For the fourth quarter of 2007, TI expects revenue to be in the following
ranges:

Total TI, $3.40 billion to $3.68 billion;

Semiconductor, $3.33 billion to $3.59 billion; and

Education Technology, $70 million to $90 million.

TI expects earnings per share to be in the range of $0.48 to $0.54.

In 2007, TI continues to expect R&D expense of about $2.2 billion
and depreciation of about $1.0 billion. TI now expects an annual effective
tax rate of about 29 percent compared with the prior expectation of 28
percent, and capital expenditures of about $0.7 billion compared with
the prior expectation of $0.9 billion.

Revenue in the third quarter was $3.46 billion. This was an increase
of 6 percent from the prior quarter primarily due to higher demand for
analog products, as well as for DSP products used in cell phone applications.
Compared with a year ago, revenue decreased 3 percent as higher analog
product revenue was more than offset by declines across a broad base
of other products.

Analog product revenue of $1.40 billion was up 10 percent from
the prior quarter primarily due to increased demand for high-performance
analog products, as well as a broad range of analog products used
in other applications, especially storage devices. Compared with
the year-ago quarter, analog revenue increased 2 percent due to
gains in high-performance analog. Revenue from high-performance
analog products increased 13 percent from the prior quarter and
10 percent from a year ago.

DSP product revenue of $1.31 billion was up 6 percent from the
prior quarter primarily due to higher demand for products used in
cell phone applications. DSP product revenue declined 4 percent
from a year ago primarily due to products used in wireless network
infrastructure and cell phone applications.

TI’s remaining Semiconductor revenue of $751 million was about
even with the prior quarter as growth in microcontroller, standard logic
and RISC microprocessor product revenue offset a decline in DLP®
product revenue. Royalties also grew on a sequential basis. TI’s
remaining Semiconductor revenue decreased 10 percent from the year-ago
quarter primarily due to declines in DLP, RISC microprocessor and standard
logic product revenue, while royalties and microcontroller product revenue
grew compared with the year-ago quarter.

Gross profit was $1.84 billion, or 53.2 percent of revenue. This was
an increase of $132 million from the prior quarter primarily due to
higher revenue. Compared with the year-ago quarter, gross profit was
about even primarily due to reduced manufacturing costs, which offset
the impact of lower revenue.

Operating profit was $1.03 billion, or 29.8 percent of revenue. This
was an increase of $126 million from the prior quarter due to higher
gross profit. It was an increase of $23 million from the year-ago quarter
due to lower R&D expense.

Semiconductor orders were $3.44 billion. This was an increase of 6
percent from the prior quarter and 4 percent from the year-ago quarter
primarily due to higher demand for analog and DSP products.

TI launched a new, low-cost DaVinci™ processor that doubles
the battery life of portable, high-definition video products such as
digital cameras and IP video security cameras.

TI introduced a power management battery fuel gauge chip that predicts
battery life with 99 percent accuracy in smartphones and other handheld
devices.

Education Technology

Revenue in the third quarter was $202 million. This was an increase
of $35 million from the prior quarter as retailers purchased calculators
for the back-to-school season. It was an increase of $20 million from
the year-ago quarter as some major retailers shifted calculator purchases
from the second into the third quarter in order to be closer to the
start of the school year.

Gross profit was $136 million, or a record 67.1 percent of revenue.
This was up $27 million from the prior quarter and $20 million from
the year-ago quarter due to higher revenue.

Operating profit was $99 million, or a record 49.1 percent of revenue.
This was an increase of $25 million compared with the prior quarter
and $16 million compared with the year-ago quarter due to higher gross
profit.

# # #

Safe Harbor Statement
“Safe Harbor” Statement under the Private Securities Litigation
Reform Act of 1995: This release includes forward-looking statements intended
to qualify for the safe harbor from liability established by the Private
Securities Litigation Reform Act of 1995. These forward-looking statements
generally can be identified by phrases such as TI or its management “believes,”
“expects,” “anticipates,” “foresees,”
“forecasts,” “estimates” or other words or phrases
of similar import. Similarly, statements in this release that describe
our business strategy, outlook, objectives, plans, intentions or goals
also are forward-looking statements. All such forward-looking statements
are subject to certain risks and uncertainties that could cause actual
results to differ materially from those in forward-looking statements.

We urge you to carefully consider the following important factors that
could cause actual results to differ materially from the expectations
of TI or its management:

Market demand for semiconductors, particularly for analog chips and
digital signal processors in key markets such as communications, entertainment
electronics and computing;

TI’s ability to maintain or improve profit margins, including
its ability to utilize its manufacturing facilities at sufficient levels
to cover its fixed operating costs, in an intensely competitive and
cyclical industry;

TI’s ability to compete in products and prices in an intensely
competitive industry;

TI’s ability to maintain and enforce a strong intellectual property
portfolio and obtain needed licenses from third parties;

Expiration of license agreements between TI and its patent licensees,
and market conditions reducing royalty payments to TI;

Economic, social and political conditions in the countries in which
TI, its customers or its suppliers operate, including security risks,
health conditions, possible disruptions in transportation networks and
fluctuations in foreign currency exchange rates;

Natural events such as severe weather and earthquakes in the locations
in which TI, its customers or its suppliers operate;

Changes in the tax rate applicable to TI as the result of changes
in tax law, the jurisdictions in which profits are determined to be
earned and taxed, the outcome of tax audits and the ability to realize
deferred tax assets;

Losses or curtailments of purchases from key customers and the timing
and amount of distributor and other customer inventory adjustments;

Customer demand that differs from company forecasts;

The financial impact of inadequate or excess TI inventories to meet
demand that differs from projections;

Product liability or warranty claims, or recalls by TI customers for
a product containing a TI part;

TI’s ability to recruit and retain skilled personnel; and

Timely implementation of new manufacturing technologies, installation
of manufacturing equipment and the ability to obtain needed third-party
foundry and assembly/test subcontract services.

For a more detailed discussion of these factors, see the text under the
heading “Risk Factors” in Item 1A of our most recent Form
10-K. The forward-looking statements included in this release are made
only as of the date of publication, and we undertake no obligation to
update the forward-looking statements to reflect subsequent events or
circumstances.

About Texas Instruments
Texas Instruments Incorporated provides innovative DSP and analog technologies
to meet our customers’ real world signal processing requirements.
In addition to Semiconductor, the company includes the Education Technology
business. TI is headquartered in Dallas, Texas, and has manufacturing,
design or sales operations in more than 25 countries.

Texas Instruments is traded on the New York Stock Exchange under the
symbol TXN. More information is located on the World Wide Web at www.ti.com.